Today I’m hanging out at Tiny Startup Camp, an uniquely Portland event. If Portland is the place young people go to retire, this is how they get paid. Jason Glaspey of Paleo Plan, and formerly Bacn, is kicking things off.

Startups are highly-scalable, meaning a small company can serve lots of people. Tiny startups are 1-2 person companies who focus on maximizing impact with minimal resources. They don’t raise venture capital — raising money means your job becomes creating a return for your investors.

Paleo Plan started three years ago with $1,000. Jason did it solo for six to nine months. The basic product of the membership site was shopping list and recipe plans. It worked well for people new to Paleo (e.g. those who’d been recommended to eat Paleo by their doctors).

One feature request he got right off the bat was recipe modifications for allergies. If a client couldn’t eat a certain item on a certain recipe, they didn’t want it on their weekly shopping list. A complex situation to the request would’ve been to customize the website to produce recipes based on known allergies. Instead, the easiest solution was to number the recipes and include the recipe number next to the item on the grocery list. The client could simply cross out the item.

Along the way, Jason has learned that successes aren’t always monetary. A few years back he and a couple friends started Bacn, a online store for bacon, in three weeks and with almost no capital. It was entirely a marketing experiment. After working on it for a few months, they sold for a nominal sum and got to write a book about it.

Question from the audience: if you give yourself three weeks to get something up, how long do you let the experiment run?

Answer: it depends. For an experiment he’s running right now (ebook with a landing page and purchase flow), he’ll give it about $1,000 dollars in time and AdWords if he thinks it will generate $10-$20k over a couple of years. He likes to shoot for making $500-$1,000/month in four months.

I asked a question about the unspoken assumption that pay-per-click advertising is the way to get your product off the ground. Jason responded that Paleo Plan started exclusively on pay-per-click advertising because he was entering a new market where he didn’t have existing clout. If you do have a well-read blog, etc. in the market you want to enter, it’s easier depend on your product just going viral.

Jason’s Tiny Filters:

• The Pager Test: Is it a big deal if your site goes down for a day? If so, not the right product and client base. Your site should be able to go down with no serious repercussions.
• Launch Quickly: Must get off the ground in three to four weeks. If it’s bigger, he’ll let someone else do it.
• Day One Profitability: It has to make money on day one.
• Self-Maintainable: He has to be able to do every step of the project. No dependence on developers, etc.
• Clear Path to Success, but Not Too Much: It shouldn’t have to be a large company if it takes off.
• Only Sell to People With Money: Pick a target market that actually has money. Not starving students.
• Work Where You Can Be Heard: Don’t enter a crowded market.

“Solve a single problem for a group of easily identifiable people who want a solution and can pay for it.” The most critical component is that your target market is actually looking for a solution. Like Googling for it.

“Don’t confuse a startup idea with a genie wish.” There are a lot of problems to be solved, but many of them can’t be easily solved. For instance, an iPhone app that tells you where the open parking spots are. How is this data going to be generated?

“Don’t confuse knowledge with skill.” You may know everything about the car industry, but that doesn’t mean you’re qualified to build a community about car enthusiasts. Build something realistic.

Some good tiny startup ideas: ebooks, membership sites, and digital downloads (e.g. ringtones, Keynote templates).

Some bad tiny startup ideas: iOS apps, global domination, advertising based, anything you have to hire out for, and acquisition-only.

“Manage major pain points by making them medium pain points.” Don’t spend three weeks perfecting something you can improve in a day. Perfect is the enemy of good enough.

Question from the audience: when’s the proper time to become a business?

Answer: once you’re making more than $100/month. LLCs are really cheap to incorporate.

The most important thing: become a problem solver. In everything you experience, figure out how to make it better.